Chinese Game Publisher Faces Action in Korea Over Loot Box Disclosure Violations

A Chinese game publisher is facing regulatory action in South Korea following reported violations of mandatory probability-based item disclosure requirements and repeated failures to respond to regulatory requests. 

On October 2, 2026, the Game Rating and Administration Committee (GRAC) announced action involving Soul Guide: In the Name of God, a game developed by China's Play Cat Network Technology.

According to the regulator, the company had failed to address multiple disclosure issues despite receiving six corrective requests. 

The case highlights an important compliance risk for overseas publishers: failing to respond to regulatory requests can escalate an existing disclosure issue.

What Happened? 6 Corrective Requests Without a Response 

GRAC identified multiple suspected violations of Korea's probability-based item disclosure requirements during its monitoring of the game. 

The regulator reportedly attempted to resolve these issues by repeatedly contacting the publisher and requesting corrective action. 

According to the October 2 announcement, GRAC:

• Issued six corrective requests concerning probability-based item disclosure violations. 
• Attempted additional communication through relevant channels, including self-rating service providers.
• Received no response or confirmation of corrective action from the publisher.

As the matter remained unresolved, GRAC proceeded with the Ministry of Culture, Sports and Tourism (MCST) to initiate the relevant administrative procedures.

The case subsequently involved public notification procedures, which may be used under Korean administrative law when ordinary service of official documents cannot be completed.

This means that a publisher's failure to receive or respond to direct communications does not necessarily prevent an administrative process from continuing.

As of the October 2 announcement, no final restriction on the game's distribution in Korea had been confirmed. However, failure to comply with an applicable corrective order could lead to further measures under the relevant legal procedures. 

Why Does This Matter for Overseas Game Publishers?

Korea has required probability-based item disclosures since March 2024.

This case demonstrates that regulatory compliance involves more than publishing probability information once.

Overseas publishers must also be able to:

• Identify and correct disclosure deficiencies.
• Receive notices and inquiries from Korean authorities.
• Respond to corrective requests without unnecessary delay.
• Maintain reliable communication between the overseas headquarters and the Korean compliance contact.

A regulatory issue may become more difficult to resolve when the publisher cannot be reached or does not respond.

Korea's Probability-Based Item Disclosure Rules

South Korea introduced mandatory probability-based item disclosure requirements on March 22, 2024, under the Game Industry Promotion Act.The framework requires covered game businesses to disclose specified probability information for probability-based items, commonly referred to as loot boxes.The purpose is to help users understand the probabilities associated with obtaining particular items or rewards.For overseas publishers, compliance involves more than including probability tables somewhere in the game.Depending on the applicable disclosure requirements, publishers must ensure that probability information is presented through the required channels, reflects actual in-game settings, and remains accurate when item configurations or probabilities change.Potential compliance issues may arise when:

• Required probability information is missing or incomplete.
• Published probabilities differ from the actual game configuration.
• Changes to probability settings are not reflected in Korean-facing disclosures.
• Required information is difficult to locate through the designated disclosure channels.

These issues can arise from operational oversights, particularly where development, live operations, and localization teams manage different parts of the disclosure process.Regular reviews can help identify inconsistencies before they become regulatory matters.

Why Unanswered Regulatory Requests Matter

One of the most notable aspects of this case is not only the reported disclosure violations but also the publisher's repeated failure to respond to GRAC.

According to the announcement, the regulator made six corrective requests and attempted additional contact through other channels.

For an overseas publisher, communication difficulties may arise because regulatory notices are sent to outdated contact information, local service providers are not authorized to respond, or the relevant internal team does not receive the request promptly.

However, these operational challenges do not necessarily stop Korean administrative procedures.

Where legally permitted, public notification may allow the process to proceed even when ordinary delivery is unsuccessful.

This creates an additional compliance risk: an issue that could potentially be addressed through timely clarification or corrective action may instead progress into formal administrative proceedings.

The case therefore highlights the importance of establishing reliable regulatory communication procedures before a problem occurs.

The Role of a Domestic Agent in Regulatory Communication

Korea's mandatory Domestic Agent system, introduced in October 2025, requires certain overseas game companies meeting specified eligibility criteria to appoint a representative in Korea. 

The Domestic Agent performs designated functions under Korean game regulations, including relevant regulatory communication and compliance-related responsibilities. 

For companies subject to this requirement, an effective Domestic Agent arrangement can help ensure that regulatory notices are received, communicated to the overseas headquarters, and addressed by the appropriate internal teams. 

However, appointing a Domestic Agent does not automatically resolve every compliance issue. 

The publisher must still maintain accurate probability disclosures and provide the information and cooperation needed to respond to regulatory requests. 

The October 2 case does not, by itself, establish whether the publisher was subject to the Domestic Agent designation requirement or had appointed one. Nevertheless, it demonstrates why reliable local communication arrangements matter for overseas companies operating in Korea.